Ever since Wertheimer discovered apparent motion (AM), controversy about its mechanism (i.e., interpolation vs. extrapolation, postdictive vs. predictive) still lingers. In this series of experiments, we addressed both questions by presenting subjects an AM stimulus starting from the middle of the screen (phase 1) and terminating at either left or right (phase 2) unpredictably. The subjects perceived both motions effortlessly, regardless of the apparent direction. Thus, the motion illusion must have been constructed in the brain only after phase 2, which determined the direction of motion. In the same experiment, we also flashed two targets simultaneously, during phase 2, at various spatial locations and asked subjects to report the temporal order of these targets. We found that almost all subjects perceived the two targets sequentially, between the two AM phases in time, when they were flashed between the AM stimuli. No sequential effect was detected on targets outside of the AM trajectory. These results are consistent with the interpolation hypothesis. In a second experiment, we studied the dependency of sequential effect on different spatiotemporal configurations of targets. We introduced a marker to help subjects to disambiguate the order of intermediate targets and asked them to judge the co-occurrence of the marker with either target while the target configuration was varied. We applied two types of AM sequences, a “predictive” when targets were presented before the AM, and a “postdictive” when targets were presented after the AM. According to the results, the marker helped subjects to perceive the correct temporal order under the predictive condition but not under the postdictive condition. We concluded that apparent motion perception is postdictive, that it relies on interpolation, and that the postdictive interpolation has a sequential masking/delaying effect on the perception of intermediate targets. The neuronal mechanism of this masking is yet to be determined.